Supreme Court upholds Bombay HC ruling on landowner right to redevelop slum

MUMBAI: In yet another order that rejected the acquisition by the Maharashtra govt and Slum Rehabilitation Authority of an upscale private property in Mumbai, the Supreme Court on Friday upheld a Bombay High Court judgment that said the law provides a preferential right to the landlord to redevelop the slum area.

The SC criticised the conduct of the SRA officials as “suspicious.”The SC bench of Justices Surya Kant and NK Singh held that permitting the state’s acquisition of land from its owner would be a “travesty of justice” when internal documents of the state and SRA reveal both accepted that the owner has a preferential right to develop the slum area.In 2018, Bombay High Court Justices Shantanu Kemkar and Girish Kulkarni, underscoring the owner’s preferential rights under the Slums Act, quashed the acquisition of an over 2-acre plot in Chandivali, Powai, directing the state and SRA to consider the landowner’s proposal for redevelopment.

The SC upheld the HC judgment.

The law requires a notice to be issued to the owner to participate in the slum’s redevelopment within a reasonable time. The Court held the clock would start ticking ‘only after the landowner is invited to submit an SR Scheme.’Indian Cork Mills Private Limited (ICM) has been the landowner since 1970. It was encroached by slums, and less than an acre was declared a ‘slum area’ in 1979. Over time, the slum expanded, and in 2002 its dwellers formed the Tarabai Nagar CHS (proposed).

The state, SRA, and Tarabai Nagar went in appeal to the SC against the HC judgment. Senior counsel Shyam Divan for Tarabai argued the HC was wrong in holding landowners had such rights, while senior counsel Abhishek Manu Singhvi and Amar Dave, for ICM, asserted that the High Court’s interpretation of the Slums Act was well-founded.The SC ruled, “The bona fides of the SRA as well as the govt are called into question when they seek to challenge, through these appeals, an interpretation that they themselves previously accepted.”

“Such an anomalous situation does not speak well of the conduct of the private and the official actors,” the SC said, adding, “To permit the acquisition to stand, despite the dubious motives of Tarabai Society and its developer and the deeply suspect conduct of the SRA, would catalyse a travesty of justice.

”The Slum Act requires a specific notice to be given first to the landowner to give a proposal for the rehabilitation of the slum on the plot, the HC ruled.

The HC had erred, the state said.The SC did not accept the contention of senior counsel Shyam Mehta representing the Maharashtra govt that the requirement of a specific notice would reduce efficiency and lead to delay. The top court said, "The requirement to wait for the owner to come forward within a reasonable time already exists. By ensuring that the owner is able to come forward sooner, the SRA would reduce delays in obtaining proposals for SR Schemes.

All that the SRA would need to incorporate into its procedure..."Significantly, the SC held, "Considering the dire consequences potentially suffered by the owner upon inadvertent failure to exercise its preferential right and the SRA’s previous notices, we find that the requirement for a specific notice inviting the owner to submit an SR Scheme, as prescribed in the Impugned Judgement, must be read as mandatory."The SC said, “The conduct of the SRA is equally, if not more, troubling and warrants closer scrutiny. Its actions reflect a pattern of shifting positions and an approach that is arbitrary and unreasonable and lacks bona fides. To begin with, the SRA made no attempt to invite or facilitate the submission of an SR Scheme from ICM. Even when ICM, on its own initiative, expressed readiness to undertake surveys and demarcation and sought the SRA’s assistance in that process, the authority remained unresponsive, turning a deaf ear to the owner’s requests.

”The SC directed the state and SRA to invite ICM to submit its proposal and to process it expeditiously.